RNS Number:6136M
PC Medics Group PLC
5 November 2001
CHIEF EXECUTIVE OFFICER STATEMENT
I am pleased to announce the Interim Results for the half year to 30 September
2001. These are the first results following our admission to the AIM market on
8 May 2001.
Our company has made strides towards fulfilling the promise of nationwide
coverage and placing the emphasis on remote access help. We believe that the
future lies in being able to effect instant repairs over a telephone or
Internet link, and our Smart Helpdesk is now providing solutions for over 80%
of all problems posed using remote access software via modem or via the Web.
We have begun to establish a network of affiliates and service partners. This
has started well with our association with the Birmingham-based Qcom, which
provides our on-site service on the M5/M6 axis from Bristol to Manchester and
across the East and West Midlands. Qcom is a service company of 23 years
standing and has over 600 customers and 2,000 prospects at which we are also
aiming our membership to the Smart Helpdesk service.
In addition, we have also formed an association with TIPS (Technology and
Internet Property Services PLC), the providers of serviced office
accommodation as Your Space in London, and, in time, throughout the rest of
the UK. We look forward to a long-term and deeper association as we start to
provide our services to the individual tenants of the Your Space buildings.
We are also pleased to announce a number of other important affiliations since
30 September 2001:-
1. A joint marketing agreement with ADVFN, the AIM-listed Web company that
provides information and dealing services to over 158,000 member traders of
stocks, bonds and commodities. It is intended that our Smart Helpdesk service
could be an essential insurance against downtime; and
2. A reseller agreement with Cable & Wireless. Your Space clients will be
interested in increased network security and faster network and Web access
provided by high-speed and leased line telephony. Many of our other clients
with multi-local and distributed offices, and growing companies with increased
IT needs are asking us to assist in this area. We believe this reseller
agreement is likely to provide our company with a significant and regular
income based on our clients' installation and ongoing use of the facility.
The unaudited interim results for the period ended 30 September 2001 have seen
a continued growth of sales of memberships, many of these for larger
configurations of servers and PCs. Turnover and gross profit have increased
from #145,897 and #29,278 for the six months to 30 September 2000 to #463,732
and #155,128 for the current period respectively. We are continuously
reviewing the level of our administration expenses and are pleased to advise
that the cut backs we have put in place coupled with the increased gross
profit have reduced the loss before taxation to #443,298 (30 September 2000 :
#479,492). We now look after nearly 4,000 PCs for 550 members and a further
300 ad hoc non-member customers. We have had a number of challenges to address
in raising the efficiency of our on-site technical support team and I am glad
to state that our monthly number of hours sold has more than doubled in the
period from some 275 to nearly 600 without an increase in headcount.
On September 1 2001 we increased both our subscription rates for new members
and our hourly charges for call-outs. We have also removed the #1-per-minute
premium telephone charge for members, preferring to offer this service for
free within the subscription.
We have raised our hardware sales considerably, and with growing memberships
at a higher rate, and increased technician charges at an enhanced rate too, we
are benefiting from a better cashflow. The profit and loss account has been
improved by charging a #30 administration fee in the first month of each
membership.
Our company is still in the early stages of its development and it is
paramount that we achieve our performance targets, be these sales of
memberships, hardware and other services or technician efficiencies. Every
endeavour is being invested in achieving these, and I thank my fellow
directors and the employees for their sterling efforts throughout this period
of maintaining the accelerated growth, when considerable commitment has been
demanded of them and rewards have been kept to a minimum.
We believe that the need for our services is universal and that there is a
great opportunity to establish a global brand. We are making great headway in
establishing the brand as the IT support company of choice here in the UK,
with London being our home territory. Now that we can confidently service
customers in the Midlands and north-west we are in the early stages of
delivering our plan to roll out the service to the rest of the UK. Already we
are able to sell memberships to nearly half of all the UK's SMEs. Our
affiliate programme should accelerate this expansion. The results for the past
six months demonstrate the management's successful adherence to its business
plans, its continued endeavours to delivering shareholder value by controlling
costs while maintaining an ambitious expansion programme, and its commitment
to realising the potential of its employees and the market opportunities.
Finally, I would like to thank all shareholders for your considerable support
during the early development of the company and the establishment of our
brand. We look forward to the next half-year with optimism for our company as
we improve our techniques and increasing numbers of customers discover the
benefits that subscribing to PC Medics confers.
.......................................
Robin Parker
Chief Executive Officer
05 November 2001
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2001
Note 6 months ended 30 6 months ended 30 Year ended 31
September 2001 September 2000 March 2001
# # #
Turnover 463,732 145,897 711,827
Cost of sales (308,604) (116,619) (522,989)
Gross profit/(loss) 155,128 29,278 188,838
Administration (596,654) (519,186) (1,212,795)
expenses
Operating loss (441,526) (489,908) (1,023,957)
Interest receivable
and similar income 3,457 12,220 19,984
Interest payable and (5,229) (1,804) (3,544)
similar charges
Loss on ordinary
activities
before taxation (443,298) (479,492) (1,007,517)
Taxation on loss on
ordinary activities 2 - - -
Loss for the (443,298) (479,492) (1,007,517)
financial period
Basic loss per share
As previously 3 - (3.0p) (6.30p)
published
As restated 3 (0.4p) (0.75p) (1.57p)
Fully diluted loss 3 (0.4p) (0.75p) (1.57p)
per share
CONSOLIDATED BALANCE SHEETS
30 SEPTEMBER 2001
30 September 30 September 31 March
2001 2000 2001
Unaudited Unaudited Audited
# # #
Fixed assets
Intangible 44,964 86,865 78,085
Tangible 130,528 145,229 142,717
175,492 232,094 220,802
Current assets
Stocks 4,721 5,128 4,825
Debtors 250,289 239,726 159,110
Cash at bank and in hand 165,525 318,047 101,532
420,535 562,901 265,467
Creditors: Amounts falling
due within one year (364,747) (316,428) (604,843)
Net current assets/ 55,788 246,473 (339,376)
(liabilities)
Total assets less current
Liabilities 231,280 478,567 (118,574)
Creditors: Amounts falling
due after more than one (1,800) (11,253) (3,262)
year
229,480 467,314 (121,836)
Capital and reserves
Called up share capital 297,679 160,000 160,000
Share premium account 1,575,515 979,705 918,580
Profit and loss account (1,643,714) (672,391) (1,200,416)
Equity shareholders' funds 229,480 467,314 (121,836)
CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2001
Note 30 September 2001 30 September 2000 31 March 2001
Unaudited Unaudited Audited
# # #
Net cash
ouflow from
operating 4 (704,961) (372,360) (615,768)
activities
Return on
investments
and servicing
of finance
Interest 3,457 12,220 19,984
received
Interest (3,818) - (1,509)
paid
Interest
element of
finance
lease (1,411) (1,834) (2,035)
payments
Net cash
(outflow)/
inflow
from
returns on
investment
and
servicing of
finance (1,772) 10,386 16,440
Taxation - - 6,033
Capital
expenditure
and
financial
investment
Purchase of
intangible
fixed
assets - - (15,000)
Purchase of
tangible
fixed
assets, (20,768) (148,905) (158,839)
net
Sale of - - 4,910
tangible
fixed assets
Net cash
inflow for
capital
expenditure
and
financial
investment (20,768) (148,905) (168,929)
Acquisitions
and
disposals
Purchase of
subsidiary - - (1)
undertaking
Net cash/
(overdrafts)
acquired
with - - 39,127
subsidiary
Net cash
inflow for - - 39,126
acquisition
and
disposals
Cash outflow
before use
of liquid
resources
and
financing (727,501) (510,879) (723,098)
Financing
Issue of 794,614 - -
equity share
capital
capital
element of
finance
lease (3,120) (1,194) (5,490)
rental
payments
Net cash
inflow from
financing 791,494 (1,194) (5,490)
Increase/ 63,993 (512,073) (728,588)
(decrease)
in cash
CONSOLIDATED CASH FLOW STATEMENTS (continued)
FOR THE SIX MONTHS ENDED 30 SETPEMBER 2001
Note 30 September 30 September 31 March
2001 2000 2001
# # #
Reconciliation of net cash
flow to movement in net funds
Increase/(decrease) in cash
in the period 63,993 (512,073) (728,588)
Cash outflow from increase in 3,120 1,194 5,490
debt
Change in net funds resulting
from
cash flows 67,113 (510,879) (723,098)
New finance leases and hire
purchase
contracts - (9,000) (9,000)
Movements in funds in the 67,113 (519,879) (732,098)
period
Opening net funds 93,571 825,669 825,669
Closing net funds 5 160,684 305,790 93,571
NOTE TO THE FINANCIAL INFORMATION
30 SEPTEMBER 2001
1 Basis of preparation
The interim financial information has been prepared on the basis of the
accounting policies adopted for the audited accounts for the year ended 31
March 2001.
The financial information has been drawn up on the going concern basis.
2 Taxation
There is no taxation charge for the period.
3 Loss per share
The basic loss per share for the half year is based on the loss after taxation
of #443,298 and the weighted average number of ordinary shares of 0.25p each
on issue of 109,893,460 (30/9/00 and 31/3/01 as restated: 64,000,000).
The previous periods' loss per share have been restated to take account of the
conversion of the nominal value of ordinary shares from shares of 1p each to
shares of 0.25p each in May 2001.
In calculating the diluted loss per share, share options and warrants have
been considered to be non-dilutive because their exercise prices are above
the current share price
4 Reconciliation of operating loss to net cash outflow from operating
activities
30 September 30 September 31 March
2001 2000 2001
# # #
Operating loss (441,526) (489,908) (1,023,957)
Depreciation of tangible fixed 32,957 22,077 52,060
assets
Amortisation of intangible fixed 33,121 29,076 65,884
assets
Decrease/(increase) in stock 104 (4,000) (2,196)
Increase in debtors (91,179) (142,620) 71,884
(Decrease)/increase in creditors (238,438) 213,015 224,412
Profit on disposal of tangible - - (3,855)
fixed assets
Net cash outflow from operating (704,961) (372,360) (615,768)
activities
5 Analysis of net debt
At 31 At 30
March Cash flow # September
2001 2001
#
Cash at bank and in hand 101,532 63,993 165,525
Finance leases (7,961) 3,120 (4,841)
Total 93,571 67,113 160,684
6 There are no recognised gains or losses other than those recorded in the
profit and loss account.
7 The interim financial information is unaudited and was approved by the
directors on 3 November 2001. The interim financial information has been
reviewed by the Group's auditors and their report is attached. The interim
financial information does not comprise full financial statements within the
meaning of Section 240 of the Companies Act 1985.
8 The figures in respect of the period ended 31 March 2001 have been taken
from the full accounts for the period ended on that date on which the auditors
reported without qualification and which contained no statement under Section
237(2) or (3) of the Companies Act 1985 (as amended) and which have been
delivered to the Registrar of Companies.
9 The Directors do not recommend the payment of a dividend.
10. A copy of this statement is being posted to all shareholders and will be
available from the Company's registered office at Lion House, Red Lion Street,
London WC1R 4GB for a period of 14 days from today.
INDEPENDENT REVIEW REPORT TO PC MEDICS GROUP PLC
Introduction
We have been instructed by the company to review the financial information for
the six months ended 30 September 2001 which comprises the profit and loss
account, the balance sheet, the cash flow statement and the related notes. We
have read the other information contained in the interim report and considered
whether it contains any apparent misstatements or material inconsistencies
with the financial information.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the directors. The directors
are responsible for preparing the interim report in accordance with the AIM
Rules which require that the accounting policies and presentation applied to
the interim figures should be consistent with those applied in preparing the
preceding annual accounts except where any changes, and the reasons for them,
are disclosed.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin 1999
/4 issued by the Auditing Practices Board for use in the United Kingdom. A
review consists principally of making enquiries of group management and
applying analytical procedures to the financial information and underlying
financial data and, based thereon, assessing whether the accounting policies
and presentation have been consistently applied unless otherwise disclosed. A
review excludes audit procedures such as tests of controls and verification of
assets, liabilities and transactions. It is substantially less in scope than
an audit performed in accordance with United Kingdom Auditing Standards and
therefore provides a lower level of assurance than an audit. Accordingly we
do not express an audit opinion on the financial information.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 September 2001.
Saffery Champness ........................................
Chartered Accountants
London
5 November 2001
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